Highlights from the automotive section of the U.S. Insurance Market Report 2012 include:

• The economy remains a major concern for automotive companies, although global vehicle sales have increased.
• The insurance markets for the automotive sector generally remained soft at the end of 2011, although carriers were typically less willing to reduce rates by greater than single digits unless extensive marketing was undertaken.

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Highlights from the chemical section of the U.S. Insurance Market Report 2012 include:

• The number and magnitude of global catastrophe (CAT) events in 2011 and the current state of the market are likely to put continued upward pressure on premiums and rates for chemical insureds.
• Underwriters are looking to more closely monitor their overall CAT exposures and hold the line on granting further rate reductions.
• Risk managers should anticipate underwriting questions related to products or chemical substances deemed unsafe, engineering concerns, and recent losses.
• Stricter underwriting guidelines are leading to more challenging renewals in which final terms often are being negotiated late. Starting the renewal process early and reducing non concurrencies should remain high priorities.

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Highlights from the construction section of the U.S. Insurance Market Report 2012 include:

• The economy remains a major concern for the construction industry.
• Primary casualty insurers are scrutinizing additional insured wording as they attempt to limit the number of parties covered.
• Project-specific professional liability insurance is limited in capacity and is costly.

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Highlights from the education section of the U.S. Insurance Market Report 2012 include:

• Education institutions continue to experience data breaches, a rise in student mental health issues, and increased focus on disaster planning and campus security.
• Global economic conditions are impacting endowments, operating expenses, and capital improvement projects.
• The severity of settlements continues to grow, especially related to student assault, sexual molestation, athletic participants, and security guard liability claims.
• Enterprise risk management is being recognized at senior levels to help implement various initiatives and assist with a decentralized campus.
• State and federal funding cuts have affected student loans and grant programs.

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Highlights from the entertainment and events section of the U.S. Insurance Market Report 2012 include:

• Signs of strengthening business conditions have appeared for the entertainment and events industry.
• Property and casualty insurance markets likely will remain competitive in 2012, especially for attractive risks and barring market changing events.
• Asset management and cost control continue to be key focus areas for risk management programs.
• Risk management programs are increasingly focused on managing the entire portfolio of risk.
• Global entertainment and event organizations require integrated insurance programs.

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Highlights from the financial institutions section of the U.S. Insurance Market Report 2012 include:

• The global economy continues to be a key concern for financial institutions, with significant focus on the economic situation in Europe.
• Companies that need mortgage impairment insurance must work through the inability of domestic insurers to provide adequate limits for flood and earthquake, and the cost of the coverage when it is available.
• Concentration of financial institutions’ employees, particularly in New York City, is an issue in workers’ compensation insurance costs.
• After accounting for more securities class action filings than any other industry in each year from 2007 to 2010, the financial sector dropped to second place in 2011, according to NERA Economic Consulting.
• Insurers are becoming more amendable to meeting the insurance requirements for Basel II compliant policies, including multiyear endorsements.

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Highlights from the health care section of the U.S. Insurance Market Report 2012 include:

• Health care reform is changing the risk landscape for insurable and uninsurable risks.
• Employment of physicians in record numbers by health systems is changing risk profiles.
• Capacity for medical professional liability is likely to remain abundant and rates are likely to remain stable, barring market changing events.
• Provider excess loss insurance is re-emerging as a means to help providers control losses for patient catastrophic illness and accidents.
• Data security/privacy continues to grow as an area of exposure for health care organizations.

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Highlights from the hospitality and gaming section of the U.S. Insurance Market Report 2012 include:

• Property insurers are likely to continue to focus on the aggregation of values in CAT-exposed areas, decreasing capacity where needed to protect their portfolios and pushing rates on insureds that have been at historical low levels or suffer significant losses.
• Workers’ compensation continues to present challenges for hospitality companies, especially in California.
• Some hotel companies are contemplating dropping an upper excess layer in order to achieve premium savings.
• Due to the rising number of food-borne illnesses stemming from tainted food supplies, insureds should consider the purchase of food contamination coverage.
• Collateral has become an increasingly important negotiation point with carriers during the renewal process. Insureds with a concentration of collateral with one carrier, or with specific collateral issues or needs, may have difficulty finding alternative solutions.

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Highlights from the life sciences section of the U.S. Insurance Market Report 2012 include:

• The products liability insurance market bottomed out at the end of 2011, with typically flat rates for good risks and rate increases, higher attachments, and reduced limits becoming more common for insureds with more challenging loss experiences.
• Well organized and thoroughly written submissions and face-to-face underwriter meetings are key to presenting exposures to insurers.
• Marine cargo and stock throughput likely will remain competitive in 2012, barring market changing events.
• Life sciences firms should pay particular attention to cyber liability and compliance with the Foreign Corrupt Practices Act.

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Highlights from the manufacturing section of the U.S. Insurance Market Report 2012 include:

• The economy remains a major concern for manufacturers.
• The insurance markets for the manufacturing sector generally remained soft at the end of 2011, although carriers were typically less willing to reduce rates beyond single digits unless extensive marketing was undertaken.
• Some insurers attempted to increase rates, generally by single digits. Companies with negative loss experiences generally saw double-digit increases.

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Highlights from the mining section of the U.S. Insurance Market Report 2012 include:

• Insurers are focusing on mining companies’ business continuity plans.
• The industry’s loss history generally has been favorable, keeping insurance premium rates stable.
• Regulations continue to affect operational costs.

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Highlights from the power and utilities section of the U.S. Insurance Market Report 2012 include:

• Ample insurance market capacity exists, resulting in generally stable rates for power and utilities companies.
• Increased merger and acquisition activities began to affect D&O rates for power and utility insureds in 2011.
• A major insurer’s exit from the excess workers’ compensation market poses challenges for insureds.

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Highlights from the public entity section of the U.S. Insurance Market Report 2012 include:

• Casualty insurance rates are likely to trend upward for public entities in 2012.
• The excess workers’ compensation market is showing significant rate increases due to increased frequency and severity associated with medical cost containment.
• Insurers are seeing increases in employment practices and workers’ compensation claims, and suggest they may be related to economic issues that have driven reductions in workforce and furloughs.

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Highlights from the real estate section of the U.S. Insurance Market Report 2012 include:

• Real estate insureds began to see pressure on insurance rates in property and casualty at the end of 2011.
• The residential real estate sector, in particular, saw significant pressure on rates.
• Market competition, well defined renewal goals, and attention to data quality should be integral components of renewal strategy.

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Highlights from the retail/wholesale, food and beverage section of the U.S. Insurance Market Report 2012 include:

• Global macroeconomic concerns, continuing high unemployment, and fluctuating consumer confidence continue to affect the industry.
• The industry continues to see regulatory and legislative activity, with particular emphasis on workforce and consumer safety.
• Recent guidance from the U.S. Securities and Exchange Commission is making information and data security a boardlevel issue.

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Highlights from the railroads section of the U.S. Insurance Market Report 2012 include:

• The railroad industry continues to watch legislation that would change the liability limit cap on rail passenger incidents.
• Insurers are looking more closely at their catastrophe capacity, especially flood for track and roadbed.

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Highlights from the transportation section of the U.S. Insurance Market Report 2012 include:

• The transportation industry is seeing signs of recovery from the economic downturn.
• There is sufficient insurer capacity to write transportation risks.
• Freight brokerage is a new line of business that is available to protect freight brokers and logistic companies.
• Insurance rates generally are tightening.

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At the end of the second quarter of 2011, the soft market conditions that have characterized the commercial property and casualty market in Canada for the past several years seem to be beginning to give way and a firmer market is on the horizon.   Read More...

Although most catastrophe losses early in 2011 were largely beyond U.S. borders, tornadoes and floods have resulted in significant losses over the past three months.   Read More...